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Fubo could be facing a difficult task in its antitrust lawsuit against major broadcasters The Walt Disney Company, Fox Corp. and Warner Bros. Discovery to derail their joint sports streaming venture.
David Gandler, co-founder and chief executive of Fubo, has claimed that the move by the major corporations, announced earlier this month, is anti-competitive and will inflate prices for consumers.
Should it go ahead, the joint venture will bring together portfolios of sports from linear networks like ESPN’s suite of linear properties, ABC and ESPN+; Fox and its properties FS1 and FS2; and WBD’s cablers such as TBS, TNT and truTV, as well as certain direct-to-consumer offerings.
Fubo’s complaint describes “anti-competitive tactics” it claims have been taken to prevent it from competing fairly in the marketplace. Those include unfair “bundling,” which has forced Fubo to carry dozens of non-sports channels that its customers do not want as a condition of licensing the broadcasters’ sports channels.
Winning its case could be an uphill challenge for Fubo.
Seth Shafer, senior research analyst, S&P Global Market Intelligence
The lawsuit was filed with the U.S. District Court for the Southern District of New York on Tuesday. Within it, Fubo claims to be at risk of losing sports-centric subscribers to the new service with the broader general entertainment and news programming unlikely to prove enough of an attractive proposition to retain them.
“Simply put, this sports cartel blocked our playbook for many years, and now they are effectively stealing it for themselves,” said Gandler in a statement.
However, it seems Fubo faces a difficult challenge to prevent the broadcasters from moving ahead, according to Seth Shafer, a senior research analyst in the Kagan media research group within S&P Global Market Intelligence.
“Fubo has leaned into sports programming to differentiate itself from other virtual multichannel services such as YouTube TV and Hulu + Live TV, so it’s no huge surprise to see the company turn to legal action to try to block the proposed streaming TV sports bundle from Disney, Fox and Warner Bros. Discovery,” commented Shafer.
“Winning its case could be an uphill challenge for Fubo as the basic process the company is objecting to—network owners leveraging the popularity of some of their top networks to gain carriage for less popular networks during carriage negotiations—is how the industry has operated for decades,” he added.
